1300Smiles LTD acquires BOH Dental Group

1300SMILES Ltd has today entered into a conditional contract to acquire one of the most highly respected general and specialist dental practices in Australia – the BOH Dental Group.

Founded in Brisbane's CBD 38 years ago by Drs Brain, O'Brien and Holzgrefe (all since retired), BOH Dental has grown into one of the largest practices in Queensland, with ten dentists and a team of hygienists, consulting dentists, laboratory and support staff.

All seven partners of BOH Dental have agreed to extended contracts with 1300SMILES.

Managing Director of 1300SMILES, Dr Daryl Holmes, commented, "I am delighted to welcome the BOH Dental team to 1300SMILES. BOH Dental is well known within our profession as a leading practice. The partners of BOH Dental are some of the industry's most respected dentists and specialists."

The acquisition provides 1300SMILES with a very strong base to grow in central Brisbane, and to grow revenue from both general and specialist dentistry.

"As I have said many times in the past, we are very selective about the practices we acquire", noted Dr Holmes. "The personnel, patient base, and reputation of BOH Dental are such that this is a great fit for our company. Our existing network of dentists in our practices will have access to a wealth of expertise and experience from BOH Dental, and the dentists at BOH Dental will in turn have access to a wider pool of referral sources. We believe this is a great win all around. A win for our company, a win for our shareholders, a win for our existing network of dentists, a win for the partners and staff of BOH Dental, and lastly but very importantly, a win for our patients."

Discussing the transaction, BOH Dental Chairman, Dr Stuart Garraway, said that "BOH Dental has a proud and successful history under private ownership. The decision to partner with 1300SMILES was not one we took lightly. We were convinced that 1300SMILES could bring much to our practice while still allowing us complete clinical control."

BOH Dental Partner and prosthodontist, Dr Brian Fitzpatrick, noted that "right throughout a lengthy process, we have been impressed with the 1300SMILES approach and willingness to partner with us. Our agreed model allows all parties to benefit from working together to provide great service and to grow our practice."

Dr David Ashton paid tribute to the quality of BOH Dental's staff. "The Partners recognise the critical role played by our wonderful team of staff across our service and laboratory businesses. We thank them for their contributions so far, and look forward to our staff enjoying even more opportunities in the future."

Patients will see no change in the short term – the business will still be known as BOH Dental – with small changes occurring over the medium term aimed at further improving the quality of care to an increasing number of patients.

The acquisition is expected to make an immediate contribution to the company's profit and earnings per share. It is expected to contribute approximately $1.2M EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) during the full 2015 financial year, as well as make contribution in the current financial year. The acquisition will be funded from a combination of cash reserves ($7,750,000 on completion) and vendor finance ($2M payable over five years).

The contract is due to complete later this month.